At its June 11, 2012 meeting, the City Council approved a resolution of intent to sell the former Maple Leaf Club/Galles Filter Building, located at 10 S. 26th Street.  Staff advertised the property for sale, informed nearby property owners about the proposed sale and published a Notice of Public Hearing for July 23, 2012.  Two entities submitted bids for the property; Interfaith Hospitality Network (IHN) and Maisie Sulser.  Both proposals failed to meet a condition in the invitation for bids.  Staff recommended selling the property to Ms. Sulser for $60,000 because her bid is higher per square foot than IHN's, the property would be fully taxable upon sale and after redevelopment, redevelopment should occur sooner than with IHN and the proposed use would add housing to the downtown.  Council conducted the required public hearing on July 23 and tabled the item until August 13. 

The City Council may choose to sell the property or to not sell it and provide additional guidance to staff.  During discussion on July 23, Councilmembers asked some questions and mentioned some options. 

• The property is located in the Central Business District, therefore it has no off-street parking requirements.  About half of lot 7 is covered by the building, so the remainder is available for parking or other uses associated with the building's re-use. 
• The property could be readvertised but since two bids were submitted and disclosed publicly, that knowledge gives other bidders an advantage that neither original bidder possessed. 
• The property was purchased with Tax Increment funds and no minimum bid or payment is required.  The City Council could donate the property if it chooses.  See the "Financial Impacts" comments below regarding expenses that could be paid from sale proceeds. 
• The only realistic way to ensure property redevelopment is to place a specific time limit on it and if violated, the property would be returned to the City. That element is part of the staff recommendation.

The $60,000 bid price could be used to modify the adjacent parking lot ($4,000), to purchase lot 17 from CDBG ($17,000) and the remainder could be deposited in the N. 27th Street Tax Increment Fund and be used for additional downtown projects. 

Staff recommends that the City Council approve selling Lot 7, Block 189, to Maisie Sulser with the following conditions:

• submit a $6,000 (10%) earnest money deposit to the City Clerk within 30 days of Council approval;
• close the property purchase within an additional 60 days;
• begin property redevelopment within six (6) months of the purchase closing date;
• a deed restriction/reversion that requires Ms Sulser to re-sell the property to the City for the original purchase price if redevelopment does not begin within six (6) months of purchasing the property.

Staff also recommends that the sale proceeds be used to modify the adjacent parking lot, to purchase lot 17 and the remainder be used for other downtown redevelopment projects.